Little progress, information recorded on SOE reforms

Update:
July, 24/2015 - 08:15

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Dang Quyet Tien, deputy head of the Corporate Finance Department under the Ministry of Finance, said only 61 out of the annual target of 289 enterprises had been equitisation so far this year. — Photo vneconomy

HA NOI (VNS) — Slow progress on reforming State-owned enterprises (SOEs) in 2015 as well as a lack of information on the performance of equitised firms is concerning financial experts.

Dang Quyet Tien, deputy head of the Corporate Finance Department under the Ministry of Finance, said only 61 out of the annual target of 289 enterprises had been equitisation so far this year.

Meanwhile, 57 businesses had yet to implement the process, Tien said in a high-level dialogue between the Ministry of Finance and the international donor partner group at a public financial management reform held yesterday in Ha Noi.

"The Prime Minister has assigned the ministries and industries to review and propose solutions," Tien said.

Aaron Batten, chief economist at the Asian Development Bank (ADB), said Viet Nam's SOE reforms remained challenging as the number of unequitised firms was a high at 228.

Batten also said the reforms were mostly taking place in small enterprises, while the big ones were still exposed to complex issues, including confused debts, weak corporate governance and a lack of transparency. This discouraged new investors.

Batten said Viet Nam sold just a small proportion of shares in SOEs while ownership of the private sector in these companies remained humble. This had given them a weak voice in company corporate restructuring.

Batten also said that only 8 per cent of SOEs published financial reports on their websites, which made the assessment on post-equitised performances more difficult.

He suggested the Government define successful and unproductive models after equitisation and use this to assess other businesses.

A representative of the Japan International Co-operation Agency (JICA) said equitisation was only the initial step in the process of SOE restructuring. The next important step should be solutions to improve corporate governance.

He said the competent authority should develop procedures to ensure the transfer of State assets to the State Capital Investment Coporation (SCIC).

Responding to donors' concerns, Tien said the Government was planning to sell State capital in batches. This meant qualified investors could buy a whole batch.

Concerning transparency, Tien said authorities had regulations covering information disclosure and firms that ignored them would receive sanctions. — VNS